T-Mobile bets the iPhone will curb subscriber churn

As you know, T-Mobile USA, the nation’s fourth-largest carrier, will finally land Apple’s iPhone next year. The Deutsche Telekom-owned telco is making no excuse for its failure to land the sough-after device earlier and, unsurprisingly, is looking to tap the popularity of the Apple smartphone to win back some of its subscribers lost to rivals AT&T, Verizon Wireless and Sprint.

T-Mobile USA CEO John Legere told reporters on Friday that his company, which has 33 million customers in the United States, is hoping to steal would-be subscribers who are eyeing an iPhone on a rival network. Even more so, the German company acknowledges that having the iPhone is key to returning to growth in subscriptions by the end of 2013…

“It is an aggressive target but we think it is possible”, Legere said Friday, according to Reuters.

The CEO previously acknowledged how lack of the iPhone hurt its business:

A certain number of customers wouldn’t come to the store if we didn’t have the iPhone. We worked very, very hard for a deal that made sense for us.

Look no further than the September quarter, when nearly half a million subscribers fled T-Mobile’s network in order to get their hands on an iPhone.

Rate of branded net contract customer losses increased year-on-year to 389,000 contracts in the third quarter of 2012 “due to the impact of the iPhone5 launch”, the wireless company acknowledged.

“We recognize that it has been a point of churn for us”, COO Jim Alling said last month while arguing the iPhone was too costly a deal for his company.

What a difference a few weeks make…

Earlier this week, T-Mobile confirmed it has struck an interesting agreement where it will start selling some wireless Apple products in 2013.

“T-Mobile USA has entered into an agreement with Apple to bring products to market together next year”,  parent Deutsche Telekom wrote in Thursday’s media release, telling The Loop that “additional details will be made available at a later date”.

The carrier plans to sell the iPhone and other smartphones in a different way, by eliminating handset subsidies by the end of the year.

Unlimited T-Mobile plans for subsidized devices start at $30 a month.

So, instead of paying a subsidized $199 iPhone, customers would pay for the full price of the device upfront and sign up for one of the unsubsidized Value Plans that offer significantly cheaper monthly rates for voice and, particularly, data services.

Here’s from Carly.


In case you were wondering, T-Mobile USA offers free support to unlockers and sells Nano SIMs. It’s in the process of rolling out the iPhone-friendly network on the 1900MHz band, which allows the 1.5 million unlocked iPhones hosted on its US network to finally surf the web at 3G HSPA+ speeds.

With a little help from the spectrum it acquired from AT&T, the carrier is moving to the iPhone-friendly 1900MHz frequency because it plans to use the current 3G HSPA+ service on the 1700/2100MHz bands for the deployment of LTE next year.

The company confirmed it’s on track to launch LTE in the second half of 2013 and cover 200 million people in the US with LTE by year-end 2013. Thanks to the spectrum gained through the MetroPCS merger, T-Mobile should as well be able to expand LTE service to 20×20 MHz “in many markets”.

Here’s more from Carly.


By the way, when T-Mobile says “4G”, they really mean 3G HSPA+ and not 4G LTE.

I know, it’s confusing as hell – talk to your senator.

Now, because the iPhone and other unlocked AT&T phones use the 1900MHz band for 3G data, T-Mobile users with unlocked iPhones who live in the areas where HSPA+ 1900MHz is available can expect to experience data speeds topping a theoretical maximum of 42 Mbps. It’s worth noting that the iPhone 5 supports the latest DC-HSPA+ technology that T-Mobile is using.

For reference, AT&T only supports HSPA+ 14.4 Mbps. According to T-Mobile’s internal tests, an unlocked iPhone 4S running over its 1900MHz HSPA+ network recorded on average 70 faster faster download speeds than iPhone 4S devices on AT&T’s network.

T-Mobile’s iPhone-friendly 1900MHz HSPA+ service is now available in five major areas: Las Vegas and Kansas City, in addition to Washington D.C., Baltimore and Houston markets.

Consumer Reports, an influential US magazine that’s been testing all kinds of products and services since 1936, ranks T-Mobile #3 in terms of  voice and data service quality, ahead of #4 AT&T and behind Verizon and Sprint.

Perhaps unsurprisingly, neither T-Mobile nor any other major carrier topped regional wireless providers in terms of customer satisfaction.

For example, U.S. Cellular in a survey conducted by Consumer Reports had an overall customer satisfaction score of 88 percent, while AT&T, Verizon, Sprint or T-Mobile individually didn’t go past a score of 72 percent.